A MAJOR scandal involving millions of United States dollars has rocked the African Business Women Association (ABWA) pitting the organisation’s founder Shamiso Fred and dismissed employees over allegations of misappropriation of funds.
Fred is accused of abusing the organisation’s funds according to state security documents obtained by the Zimbabwe Independent.
But there are indications that there was already a grand looting scheme of funds at the organisation by former employees who are now accusing the ABWA founder of abusing funds.
According to confidential documents seen by the Independent, Fred is accused of having used a trust, a private voluntary organisation and several companies operating under ABWA to lure over 2 000 people who invested a minimum of US$1,036 each in return for 22 monthly shares of a minimum US$250 depending on the investment.
Allegations say the ABWA founder convinced each investor that the money would be used to purchase, produce and market livestock and a monthly share payout will be made from the proceeds of livestock production.
Allegations further state that upon registration, Fred started operating outside the mandate of the terms of the private voluntary organisation (PVO) which is in contravention of PVO Act.
“On 12 February 2018, Shamiso Fred was granted a PVO registration of the African Business Women Association with registration number PVO 52/2017. The PVO was registered to provide vocational training, life skills and mentoring women to initiate self-help projects, to provide women with loans for running self-help projects and to provide psychosocial support to women and girls so that they become independent.
“Upon the registration of the PVO, Fred began operating outside the mandate of the terms of the PVO registration and this is a combination of the PVO Act (Chapter 17:05) and is grounds for cancellation of the PVO terms of Section 10 of the PVO Act. Investigations reveal that instead of conducting livestock production, Fred diverted money received from investors to personal use,” the document noted.
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There are further allegations that, with the money, Fred allegedly bought a residential property (Unit 2 number 10 Tamar Avenue, Vainona) from Challenge Mukamba for US$300 000 where she currently resides.
According to the document, she also allegedly bought a Willowglen plot in Hatcliff measuring 32 374 square metres from one Mowonera for US$400 000.
Fred went on to construct a modern house for her parents on Chiriseri Farm in Domboshava before buying a number of luxury vehicles, the document further states.
However, contacted for a comment, Fred rubbished all the allegations citing that ABWA was operating legally and went further to show documents supporting how the organisation applied to the Ministry of Public Service, Labour and Social Welfare notifying of its intention to become a profit-making organisation.
ABWA notified the department of social development in a letter dated March 15 2022.
“ABWA was registered as a PVO in 2017 in accordance with PVO Act (Chapter 17:05). However, the organisation is desirous to implement a name change that would more accurately reflect the operational thrust of the organisation.
We would like to rename the organisation as Africa Business Women Charity Organisation. We would appreciate your guidance on the remaining process,” read the letter.
An investor circular dated September 22 2022, generated by ABWA highlighted the need for an audit to ascertain the extent of financial misappropriation at the firm.
The firm appointed audit firms, TM Consultancy (internal audit) and Baker Tilly (external audit).
“In light of this, the board resolved to conduct a forensic audit investigation to determine the extent of fraudulent activities. Following the initial feedback from two forensic investigations, the board resolved to suspend payments to investors to enable us to conduct a detailed review. In the interim, we have actioned a full compliance review and we would encourage your urgent participation,” the circular read.
Fred, speaking to the Independent said there was a massive looting of funds by some former employees and the matter was now under investigation by authorities.
“The issues are still under investigation and we cannot divulge further details but there was misappropriation of funds.
There are people trying to cover up crime through raising frivolous allegations which hold no substance.
“We have credible running programmes with the government and these allegations are only meant to disturb our focus but we are bigger than that,” Fred said.
The Independent is informed that a number of employees have since left the organisation since the forensic audit started.
